Per settlement, Dragon Box will pay $14.5M and close piracy-enabling services.

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The entertainment industry has scored a big victory over the maker of a "free TV" box that helped users watch pirated video.

Dragon Media Inc., whose "Dragon Box" device connects to TVs and lets users watch video without a cable TV or streaming service subscription, has agreed to shut down the Dragon Box services and pay $14.5 million in damages to plaintiffs from the entertainment industry.

Dragon Media was sued in January 2018 by Netflix, Amazon, Columbia Pictures, Disney, Paramount Pictures, Twentieth Century Fox, Universal, and Warner Bros. Dragon Media's lawyer initially predicted that the lawsuit would backfire on the entertainment industry, but the Dragon Box maker must have decided it had little chance of winning at trial.

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The settlement requires Dragon Media to "cease all operation of the Dragon Box system" and related services within five days. Under the settlement, "[j]udgment shall be entered against Defendants and in favor of Plaintiffs on Plaintiffs' claims of copyright infringement, and damages shall be awarded to Plaintiffs in the amount of US $14,500,000," the document says.

Dragon Media, Dragon Media owner Paul Christoforo, and reseller Jeff Williams "[s]hall be further enjoined from operating any website, system, software, or service that is substantially similar to the Dragon Box service," the settlement says.

The settlement also prohibits the defendants from making its source code or other technology available to others.

Plaintiffs previously shut down “TickBox”

The plaintiffs in the case are part of the Alliance for Creativity and Entertainment (ACE), which has been trying to stamp out piracy of its members' content.

"ACE is pleased the agreement will ensure the immediate shutdown of the illegal Dragon Box system," an ACE spokesperson said, according to Variety. "The theft of creative content is a pervasive threat to the dynamic legal marketplace for movie and television content, and ACE will continue its global efforts to advance creativity."

In September 2018, ACE members scored another favorable settlement over the maker of a similar streaming device called the TickBox, winning a permanent injunction and $25 million in damages.

Before agreeing to settle, Dragon Media argued that it was merely facilitating access to online content rather than providing pirated TV itself. The entertainment industry plaintiffs' complaint provided a much different description, saying that Dragon Media provided custom software to help users of its device obtain pirated content. The complaint said:

When a customer selects "DRAGON MEDIA" for the first time, the device prompts the customer to download the "DragonBox" software. After clicking through the guided "Media Setup," the device downloads and installs the latest version of Dragon Media.

Once the Dragon Media software application has been downloaded and installed onto the Dragon Box device, the customer is presented a multi-page home screen that presents the customer with categories to select. These categories include "Sports," "4Kids," "Videos," "IPTV," and "TV Shows," among others... In total, Defendants provide customers with over 80 add-ons as part of their suite of Dragon Media add-ons to access all of the "Unlimited Shows, Movies, [and] Live Sporting events."

Dragon Media temporarily stopped sales after the lawsuit was filed last year but "later decided to change its business model, moving from a Kodi-addon platform subscription-based services," TorrentFreak wrote today. "First, it moved to 'BlendTV' and a few months later to 'My TV Hub.'"

However, the settlement requires Dragon Media to shut down both BlendTV and My TV Hub at the same time that it shuts down the Dragon Box service. The settlement defines the Dragon Box Service as "the hardware devices preloaded with copyright infringing software, addons, programs, applications, and all related services that Defendant marketed, promoted, sold, and supported." The settlement defines BlendTV as "the copyright-infringing software, programs, applications, and services that transmit or otherwise communicate television programs and motion pictures over the Internet that Defendant marketed, promoted, sold, and supported."